Voegele Mech., Inc. v. Local Union No. 690 of the United Ass'n of Journeymen & Apprentices of the Plumbing & Pipe Fitting Indus. of U.S. & Can.

• Decision Date: 19 August 2019
• Docket Number: CIVIL ACTION No. 18-3018
• Citation: 403 F.Supp.3d 447
• Parties: VOEGELE MECHANICAL, INC., Plaintiff, v. LOCAL UNION NO. 690 OF the UNITED ASSOCIATION OF JOURNEYMEN AND APPRENTICES OF the PLUMBING AND PIPE FITTING INDUSTRY OF the UNITED STATES AND CANADA, Defendant.
• Court: U.S. District Court — Eastern District of Pennsylvania

403 F.Supp.3d 447

VOEGELE MECHANICAL, INC., Plaintiff,

v.LOCAL UNION NO. 690 OF the UNITED ASSOCIATION OF JOURNEYMEN AND APPRENTICES OF the PLUMBING AND PIPE FITTING INDUSTRY OF the UNITED STATES AND CANADA, Defendant.

CIVIL ACTION No. 18-3018

United States District Court, E.D. Pennsylvania.

Filed August 19, 2019

Walter Stephen Zimolong, Zimolong LLC, Villanova, PA, George A. Voegele, Jr., Cozen O'Connor, Philadelphia, PA, for Plaintiff.

Robert P. Curley, O'Donoghue & O'Donoghue, Philadelphia, PA, for Defendant.

MEMORANDUM

ROBERT F. KELLY, Sr. J.

Presently before the Court is the Second Motion to Dismiss or, in the Alternative, to Stay Proceedings Pending Arbitration filed by Defendant Local Union No. 690 of the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada ("Local 690"), Plaintiff Voegele Mechanical, Inc.'s ("Voegele") Memorandum of Law in Support of Reply in Opposition to Motion to Dismiss, Local 690's Reply, and Voegele's Sur-Reply. For the following reasons, Local 690's Motion to Dismiss is granted.

I. BACKGROUND

On or about September 11, 2017, Voegele entered into a contract with Hutter Construction Corporation ("Hutter") whereby Voegele agreed to provide and install a central heating and plumbing system for a new multi-unit apartment complex located at 401 Race Street in Philadelphia, Pennsylvania (the "Project"). (Am. Compl. ¶¶ 10, 14.) Hutter acted as the general contractor for the Project. (Id. ¶ 14.) Both non-union and union contractors and members performed work on the Project. (Id. ¶¶ 13, 15, 17.)

Voegele and Local 690 are parties to a collective bargaining agreement ("CBA") effective May 1, 2016 to April 30, 2019. (Id. ¶¶ 6, 7, Ex. A (CBA).) The CBA contains a no-strike clause, as well as a grievance procedure culminating in arbitration. (Id. ) The CBA contains the following arbitration clause:

It is mutually agreed that all disputes of any nature whatsoever which may arise between the parties hereto, or their respective individual members, shall be submitted to the Joint Arbitration Board, which shall consist of three (3) members of EMPLOYERS' ASSOCIATION and three (3) members of the LOCAL UNION.

(CBA art. XXIII, § 1 – Adjustment and Arbitration of Disputes.) Under Article VIII of the CBA, Local 690 agreed to furnish competent plumbers and apprentices to Voegele Mechanical. (CBA art. VIII, § 1 – Union Membership.) In Appendix A to the CBA, the Union agreed there would be no work stoppages "due to unauthorized or illegal strikes, lockouts, disputes, or grievances." (CBA app. A.) Appendix A further provides that "[w]orkmen shall be on the job at the designated starting time, and will not leave until the designated quitting time." (Id. ) Further, Article XXIII of the CBA sets forth procedures for the settlement of disputes and grievances arising under the terms and conditions of the CBA, and provides that all questions involving the interpretation of the CBA shall be referred to a grievance procedure ending in binding arbitration, and that no dispute, whether jurisdictional or otherwise, shall result in any stoppage of work or lockout during any dispute. (CBA art. XXIII – Adjustment and Arbitration of Disputes.)

In October 2017, a labor dispute arose at the Project. On or about October 27, 2017, members of a different trade union set up a picket line at the Project to protest the presence of a non-union contractor working on the Project. (Id. ¶ 15.) Voegele alleges that its union member employees left the Project because of the picket line. (Id. ¶ 16.) Hutter then set up a dual or reserve gate system whereby one entrance to the Project was for use of union contractors, their employees, and their suppliers and the other gate for the non-union contractors, their employees and suppliers. (Id. ¶ 17.) Voegele alleges that Local 690 induced, encouraged, and told its members to refuse to honor the dual gate system and to not cross any picket line. (Id. ¶ 18.) It further alleges that Local 690 instructed its members to do so in writing through a card which it distributed to its members working on the Project. (Id. )

In March 2018, members of the local Northeast Regional Council of Carpenters Union (the "Carpenter's Union") began picketing the non-union gate at the Project. (Id. ¶ 19.) The Carpenters Union does not represent Voegele's employees and they did not picket the gate or entrance used by Local 690 members. (Id. ) However, Voegele alleges that its employees represented by Local 690 followed Local 690's orders and refused to cross the Carpenter's Union's picket line. (Id. ¶ 20.) The Carpenter's Union picketed the Project throughout April 2018 and each time, as Local 690 allegedly ordered, Voegele's employees refused to report for work. (Id. ¶¶ 22-25.) Ultimately, Hutter informed Voegele that it was in breach of its contract with Hutter because it was unable to consistently provide labor to the Project and terminated Voegele's contract. (Id. ¶ 28.) Hutter's termination caused Voegele to lose an estimated $675,000 in lost profits. (Id. ¶ 31.) On or about July 20, 2018, Voegele was forced to shut down and go out of business. (Id. ¶ 32.)

II. PROCEDURAL HISTORY

On July 19, 2018, Voegele filed a Complaint against Local 690. (See Doc. No. 1.) On August 7, 2018, Voegele filed an Amended Complaint against Local 690, which includes Count One "Violation of Section 303 of the Labor Management Relations Act" ("Count One – Section 303/Secondary Boycott") which relates to allegations of a secondary boycott in violation of the fair labor standards,¹ and Count Two "Breach of Contract in Violation of Section 301 of the Labor Management Relations Act" ("Count Two – Section 301/Breach of CBA") regarding a breach of the CBA.² (See Doc. No. 4.)

Specifically, Count One – Section 303/Secondary Boycott states:

35. Since on or about March 2018, Local 690, through its officers, agents, representatives and members, engaged in, or induced or encouraged members employed by Voegele Mechanical to engage in a unlawful strike or work stoppage, and concerted suspension of work, and/or endorsed or ratified the actions of its members in engaging in an unlawful strike or work stoppage, where a goal of the strike or work stoppage, where the goal was not to preserve work for Voegele Mechanical employees, but rather was to coerce or restrain secondary employers such as union contractor Voegele Mechanical, and the general employees and the general contractor, to cease doing business with non-union contractors on the 401 Race Street job.

36. The Union's unlawful strike, work stoppage and concerted suspension of work violated the prohibition on secondary boycotts contained in 29 U.S.C. § 158(b)(4), and 29 U.S.C. § 187(a), and Voegele Mechanical has suffered damages as a result.

(Id. ¶¶ 35-36.)

In Count Two – Section 301/Breach of CBA, Voegele asserts:

43. By instructing its members not to work when there was a picket line at the job, and/or failing and/or refusing to direct its members to work at 401 Race Street job, Local 690 failed to provide labor and thus violated the terms of the CBA, and Local 690 endorsed and/or ratified the actions of its members in violating the terms of the CBA.

44. The Union's unlawful actions caused the general contractor to terminate Voegele Mechanical from the 401 Race Street job.

(Id. ¶¶ 43-44.) Both counts allege identical damages of $675,000. (Id. ¶¶ 38, 45.)

Originally, Local 690 filed a Motion to Dismiss on December 10, 2018. (Doc. No. 10.) Local 690 explains that "[a]fterwards, Voegele's counsel contacted Local 690's counsel and suggested the parties file a Joint Stipulation/Proposed Order that Count Two of Plaintiff's Amended Complaint proceed to Arbitration and Count One be stayed." (Def.'s Mem. Law Support Second Mot. to Dismiss at 3) (citing Doc. No. 10). On December 27, 2018, the Court signed the parties' Stipulation and Order stating that Count One of Plaintiff's Amended Complaint shall be stayed pending the arbitration proceedings regarding Count Two. (Id. ) (citing Doc. No. 12). On February 15, 2019, the Joint Arbitration Board heard testimony regarding Voegele's grievance. (Doc. No. 14, Ex. 1 (Joint Arbitration Board Decision).) The Joint Arbitration Board defined the issue as: "Local 690's alleged violation of the CBA and the Labor Management Relations Act for allegedly failing to provide Labor on the 401 Race Street Job." (Id. ) After hearing the evidence presented, the Joint Arbitration Board decided that "[b]ased on the information and testimony presented to the Joint Arbitration Board on Friday, February 15, 2019, the Board found on a unanimous decision in favor of Local 690 and against the Grievant." (Id. )

On March 14, 2019, Local 690 filed its Second Motion to Dismiss or, in the Alternative, to Stay Proceedings Pending Arbitration.³ (Doc. No. 16.) Voegele filed its Response in Opposition on April 4, 2019. (Doc. No. 17.) Local 690 filed a Reply, and Voegele filed a Sur-Reply. (Doc. Nos. 18, 19.) Oral argument was held on May 21, 2019. (Doc. Nos. 20-22.)

III. LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(1) allows a party to move for dismissal of any claim for which the district court lacks subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1). A challenge to subject matter jurisdiction can be either facial or factual. See Gould Elecs. Inc. v. United States , 220 F.3d 169, 176 (3d Cir. 2000) (citing Mortensen v. First Fed. Sav. & Loan Ass'n , 549 F.2d 884, 891 (3d Cir. 1977) ). "In reviewing a facial attack, the court must only consider the allegations of the complaint and documents referenced therein and attached thereto, in the light most favorable to the plaintiff." Id. (citations omitted). "In reviewing a factual attack, the court may consider evidence outside the pleadings." Id. (citations omitted). "The trial court is free to weigh the evidence and satisfy itself as to the existence of its power to hear the...